Fixed-Term Employment (FTE)
Indian Economy
- PYQs8
- Articles1
Background
FTE is a significant aspect of labour market flexibility with implications for worker rights, job security, and the informalisation of the economy. UPSC examines such policy tools and their socio-economic consequences.
Fixed-Term Employment refers to a contractual employment arrangement where an employee is hired for a specific, predetermined period, often for a particular project or season, rather than on a permanent basis, offering flexibility to employers.
Facts & tables
- Introduction in India
- Formally introduced into India's labour law framework by the Industrial Relations Code, 2020.
- Employer Flexibility
- Allows employers to hire workers for a fixed duration without the complexities of permanent employment.
- Worker Vulnerability
- Concerns exist due to the lack of specified minimum tenure or limits on the number of contract renewals in the rules.
- Risk of Informalisation
- Potential for even regular positions to be converted into FTEs with unlimited renewals, leading to job insecurity and informalisation.
| Type | Reference |
|---|---|
| Conceptual area | Labour Market Flexibility |
| Conceptual area | Worker Rights |
Prelims angle
Prelims angle: Statement-based questions
Prelims angle: Conceptual understanding
- Contractual employment for a specific period.
- Introduced by Industrial Relations Code, 2020.
- Concerns: No minimum tenure, unlimited renewals.
- Risk: Regular jobs becoming FTEs, job insecurity.
- Impacts worker rights and labour market informalisation.
| Year | Framing tags |
|---|---|
| 2026 | Factual recall, Multi-statement analysis |
| 2024 | Terminology-based question, Factual recall |
| 2021 | Multi-statement analysis, Factual recall |
| 2020 | Multi-statement analysis, Conceptual understanding |
| 2020 | Factual recall, Terminology-based question |
| 2019 | Multi-statement analysis, Factual recall |
| 2019 | Statement-based questions, Conceptual understanding |
| 2016 | Multi-statement analysis, Factual recall |
Timeline
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Labour Market Flexibility
Conceptual area
-
Worker Rights
Conceptual area
-
Prelims 2016
Multi-statement analysis, Factual recall
-
Prelims 2019
Multi-statement analysis, Factual recall
-
Prelims 2019
Statement-based questions, Conceptual understanding
-
Prelims 2020
Multi-statement analysis, Conceptual understanding
-
Prelims 2020
Factual recall, Terminology-based question
-
Prelims 2021
Multi-statement analysis, Factual recall
-
Prelims 2024
Terminology-based question, Factual recall
-
Prelims 2026
Factual recall, Multi-statement analysis
-
Implementation complete, but workers still vulnerable
Fixed-Term Employment (FTE), formally introduced by India's Industrial Relations Code, allows hiring for a specific period. While offering flexibility, it raises concerns about worker vulnerability due to the absence of minimum tenure and potential for unlimited renewals, contributing to job insecurity and the informalisation of the workforce.
See also
Past papers
2016–2026 · 8 questions
In the news
Implementation complete, but workers still vulnerable
Fixed-Term Employment (FTE), formally introduced by India's Industrial Relations Code, allows hiring for a specific period. While offering flexibility, it raises concerns about worker vulnerability due to the absence of minimum tenure and potential for unlimited renewals, contributing to job insecurity and the informalisation of the workforce.
Try these PYQs
Consider the following statements :
As per the Industrial Employment (Standing Orders) Central (Amendment) Rules, 2018
1. if rules for fixed-term employment are implemented, it becomes easier for the firms/companies to lay off workers
2. no notice of termination of employment shall be necessary in the case of temporary workman
Which of the statements given above is/are correct?
Statement 1 is correct: Fixed-term employment and ease of layoff. The amendment introduces the concept of "fixed-term employment" for the first place. While it doesn't automatically make layoffs easier, it allows companies to hire for specific projects or periods without them becoming permanent employees. This can potentially make restructuring or downsizing during economic downturns easier for companies with fixed-term employees compared to permanent ones (who have greater job security). Statement 2 is correct: Notice period for temporary workmen.
The amendment clarifies that no notice period is required to terminate the employment of a "temporary workman," which is someone hired for a specific, non-continuous job or for a short period.
Which of the following international conventions have **not** been ratified by India?
1. Employment Policy Convention
2. Abolition of Forced Labour Convention
3. International Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families
4. Geneva Convention Relative to the Protection of Civilian Persons in Time of War
5. Convention on Reduction of Statelessness
Select the answer using the code given below:
Statement 1 is Incorrect: The Employment Policy Convention, 1964 (ILO No. 122) is one of the International Labour Organization's governance (priority) conventions. India ratified it on November 17, 1998. Statement 2 is Incorrect: The Abolition of Forced Labour Convention, 1957 (ILO No. 105) is a fundamental ILO convention. India ratified it on May 18, 2000. Statement 3 is Correct: The International Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families (1990) is a UN multilateral treaty. India has neither signed nor ratified this convention. Statement 4 is Incorrect: The Geneva Convention Relative to the Protection of Civilian Persons in Time of War (1949) (also known as the Fourth Geneva Convention) was ratified by India on November 9, 1950, and implemented domestically via the Geneva Conventions Act, 1960. *(Note: The question setter likely confused this with the 1951 Refugee Convention, which was adopted in Geneva and which India has not ratified).* Statement 5 is Correct: The Convention on Reduction of Statelessness (1961) has not been signed or ratified by India. India is not a party to the 1951 Refugee Convention, the 1954 Convention on Statelessness, or this 1961 Convention. *Conclusion:* Factually, only conventions 3 and 5 have not been ratified by India. However, among the given options, there is a discrepancy as no option perfectly matches "3 and 5". Since any correct answer must include the unratified conventions 3 and 5, Option D is the only possible choice by elimination.
Which of the following statements is/are correct regarding the Maternity Benefit (Amendment) Act, 2017?
1. Pregnant women are entitled for three months pre-delivery and three months post-delivery paid leave.
2. Enterprises with crèches must allow the mother minimum six crèche visits daily.
3. Women with two children get reduced entitlements.
Select the correct answer using the code given below:
The Maternity Benefit (Amendment) Act 2017 has made several significant changes to benefit women employees - Paid maternity leave has been increased to 26 weeks from 12 weeks. - For women expecting after having 2 children, the leave duration remains at 12 weeks. - Establishments employing 50 or more employees must provide a crche facility, and women employees should be allowed to visit the facility 4 times during the day.
Which of the following is/are the indicator/indicators used by IFPRI to compute the Global Hunger Index Report?
1. Undernourishment
2. Child stunting
3. Child mortality
Select the correct answer using the code given below:
All three indicators (1, 2, and 3) are used by IFPRI (International Food Policy Research Institute) to compute the Global Hunger Index Report. The Global Hunger Index (GHI) is a tool designed to comprehensively measure and track hunger at global, regional, and national levels. It's a peer-reviewed annual report, now jointly published by Concern Worldwide and Welthungerhilfe. Purpose: To assess hunger severity and track progress towards ending hunger. Each country's GHI score is calculated based on a formula that combines four indicators that together capture the multidimensional nature of hunger - Undernourishment - The share of the population whose caloric intake is insufficient; - Child Stunting - The share of children under the age of five who have low height for their age, reflecting chronic undernutrition; - Child Wasting - The share of children under the age of five who have low weight for their height, reflecting acute undernutrition; and - Child Mortality - The share of children who die before their fifth birthday, reflecting in part the fatal mix of inadequate nutrition and unhealthy environments. Hence, option C is the correct answer.
With reference of the Indian economy after the 1991 economic liberalization, consider the following statements:
1. Worker productivity (per worker at 2004-05 prices) increased in urban areas while it decreased in rural areas.
2. The percentage share of rural areas in the workforce steadily increased.
3. In rural areas, the growth in non-farm economy increased.
4. The growth rate in rural employment decreased.
Which of the statements given above is/are correct?
Statement 1 is incorrect. After the 1991 economic liberalization, worker productivity increased both in urban and rural areas. While urban areas experienced higher growth, rural areas also saw improvements, especially with the rise in non-farm activities. Statement 2 is incorrect. The percentage share of rural areas in the workforce has steadily decreased since liberalization. This is because more people have moved to urban areas for employment in the industrial and service sectors, contributing to the growing urban workforce. Statement 3 is correct. In rural areas, the growth of the non-farm economy increased significantly. With liberalization, the diversification of rural economies into sectors like manufacturing, construction, and services grew, reducing the dependency on agriculture. Statement 4 is correct. The growth rate in rural employment decreased after 1991. While the rural economy diversified, the agricultural sector did not provide enough employment opportunities to absorb all the labor, leading to lower growth in rural employment. Hence, option B is the correct answer.
Show 3 more PYQs
With reference to the period of Gupta dynasty in ancient India, the towns Ghantasala, Kadura and Chaul were well known as
During the Gupta dynasty (c. 320–550 CE), external trade flourished and several coastal towns emerged as significant maritime centres. Ghantasala and Kadura were located on the eastern coast (Andhra region) and functioned as active ports facilitating overseas commerce, particularly with Southeast Asia and other regions. Ghantasala: Located in present-day Andhra Pradesh, Ghantasala served as an eastern coastal port actively engaged in maritime trade with Southeast Asia and possibly even with the Roman world. Kadura: Also located in the Andhra region (eastern coast), Kadura functioned as a significant port under the Gupta-era trade network and handled trade goods like textiles, spices, and ivory. Chaul: located on the western coast in present-day Maharashtra, acted as a western seaport linking India with Western Asia and was known for trade in cotton textiles and other goods.
With reference to the Indian economy, "Collateral Borrowing and Lending Obligations" are the instruments of :
* Collateral Borrowing and Lending Obligations (CBLO) are instruments of the: C. Money market * CBLO is a money market instrument that facilitates borrowing and lending operations on a collateralized basis. It is used by banks, financial institutions, and other entities to manage their short-term liquidity requirements.
With reference to the casual workers employed in India, consider the following statements:
1. All casual workers are entitled for Employees Provident Fund coverage.
2. All casual workers are entitled for regular working hours and overtime payment.
3. The government can by a notification specify that an establishment or industry shall pay wages only through its bank account.
Which of the above statements are correct?
Statement 1 is not correct: The Government had launched a scheme viz Casual Labourers (Grant of Temporary Status and Regularization) Scheme of Government of India, 1993. As per the scheme, Temporary status would be conferred on all casual labourers who were in employment and who have rendered a continuous service of at least one year, which means that they must have been engaged for at least 240 days (206 days in case of offices observing 5 days week). Statement 2 is correct: The Supreme Court has decreed that casual workers are also entitled to social security benefits as stipulated in the Employees Provident Funds and Miscellaneous Provisions Act. The Court's ruling stemmed from its interpretation of Section 2(f) of the EPF Act, wherein the definition of an "employee" encompasses a broad scope, including any individual engaged directly or indirectly in connection with an establishment's work and receiving wages. A bench of the Supreme Court affirmed this viewpoint. Statement 3 is correct: The government has the authority to specify through a notification that an establishment or industry is obligated to disburse wages exclusively via its bank account.